US enterprises are
expected to spend more than $46 billion over the next five years on Ethernet
services provided by carriers, according to a new market research study from The
Insight Research Corporation. Ethernet revenues continue to grow during the
forecast period but at a slower pace. There continues to be increasing data
bandwidth demands and the service's TCO advantages in providing high and
flexible bandwidth at relatively low costs with flexibility and scalability
superior to that of competitive data services. Ethernet metro area and wide area services are
ubiquitous, available from all major data service providers, including cable/MSOs,
who are building a formidable base around Ethernet services in the small to
mid-sized business market. Industry revenue is expected to grow from nearly $6
billion in 2014 to over $9.8 billion by 2019.

According to Insight Research's market analysis study, "US
Carriers and Ethernet Services, 2014-2019," Ethernet's popularity is driven
by its ability to meet growing bandwidth demands at lower cost and with greater
flexibility than legacy TDM-based services. The large-scale migration of
wireless backhaul cell sites from TDM to Ethernet continues to be a major factor
in the next five years, as carriers complete their 4G LTE deployments.

"Today, Ethernet services for enterprise data is about much more than
connecting LANs. Although LAN interconnect is still an important application for
the enterprise, the combination of advancing technology and a tech savvy
workforce has allowed the user to harness computing power without having to rely
on the IT department," says Bob Rosenberg, President of Insight Research.

"Wireless backhaul will largely be Ethernet services in the future. Cloud
providers will have enormous data centers connected by 40 Gbit/s to 100 Gbit/s
links. Enterprises will connect to these cloud providers through lower speed
point to point Ethernet links reducing the need for LAN interconnect to some
extent," Rosenberg concluded.

The study examines Ethernet market spending and usage patterns by topology
(E-line, E-LAN, and access), regional domain (metro, wide area, and access),
retail/wholesale, and various bandwidth levels. In addition, the report covers
the impact industry standards, such as MEF CE2.0, have on the market, as wells
as carriers increased reliance on interoperability with other service providers.